The Governing Board of the Benicia Unified School District will hear a discussion and then vote on the district’s 2017-18 first interim financial report at Thursday’s school board meeting.

The district provides the report using information from the budget adopted by the state in June along with the Local Control Funding Formula (LCFF) as well as other budget assumptions.

The LCFF is a funding system approved by the state in 2013 which establishes grants in place of funding streams. It is how school districts in California, including BUSD, are funded. According to a presentation by Chief Business Official Tim Rahill, the LCFF provides $8,262 per BUSD student and includes a base grant as well as a 20 percent increase for English language learning or foster youth students as well as those enrolled in the free/reduced lunch program. According to Rahill, those three groups make up 22 percent of BUSD’s student population.

Utilizing information from the state budget, Rahill wrote that the district would be operating at a $1.8 million operating deficit, not including negotiating costs with any of the district employee groups and would provide for the state’s 3 percent Reserve for Economic Uncertainties and the Local Board Policy Reserve, consisting of an additional 4 percent reserve.

Rahill said the $1.8 million deficit includes spending one-time funds of $800,000, with the remaining $1 million operating loss being for general ongoing operations. The budget includes LCFF funding at the proposed state gap factor of 43.19, a reduction in LCFF funds due to 91 fewer students, annual increases in operating costs such as salary step and increased payroll benefit rates, and program costs from the Local Control Accountability Plan (LCAP), which provides an account of district goals based on state and local priorities and is required to receive LCFF state funding. Adding to this, Rahill wrote that student enrollment would decline by 82 students for the 2017-18 school year.

Based on the state budget, Rahill wrote that BUSD would consider budget cuts for the 2018-19 school year, and the State Budget Information would be updated in January by Gov. Jerry Brown for his annual budget proposal. Rahill also noted that while all contract negotiations with employee groups had been settled for 2016-17, they have not been settled for 2017-18. As a result, there are no costs for negotiated salary settlements in the 2017-18 budget.

According to Rahill, the 2017-18 budget will provide for the state’s 3 percent Reserve for Economic Uncertainties and the additional 4 percent Board Policy Reserve, ensuring the district’s ability to provide a positive certification for the 2017-18 budget. The school board will vote to approve the report. If accepted, it will be filed with the Solano County Office of Education. After Brown announces his budget proposal in January, BUSD will report back to the school board with potential impacts on the school budget and provide a second interim financial report in March.

In other business, BUSD auditor James Marta will present the audits of district and Measure S bond financials. There will also be a reorganization of the Governing Board, as clerk Diane Ferrucci will be voted to continue as board president, taking the reins from Gary Wing after he is termed out. The trustees will also vote to appoint a new clerk as well as members of various committees and approve the schedule of meetings for 2018.

The board will meet at 7 p.m., Thursday, Dec. 14 in the Benicia Unified School District Board Room at the district building on 350 East K Street. There will be an earlier closed session at 6 p.m.

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